Sberbank Europe Group HY 2016 results


Mag. Linda Michalech
Corporate Communications Manager

Sberbank Europe AG
Tel.: +43 1 22732 1300
Mobile: +43 664 8891 3662

Sberbank Europe Group HY 2016 results

Sberbank Europe Group: Net profit of EUR 13.8 million on the back of improved operating income and increased cost efficiency

For the first six months of 2016, Sberbank Europe reported a profit after tax of EUR 13.8 million. Sberbank Europe continuously increased its customer base while improving on both the income and the cost side. The capital and liquidity positions have been strengthened, enabling the bank to grow further its corporate and retail business in all its markets.

Sberbank Europe started the year with a significant improvement of its capital structure by converting EUR 370 m of subordinated loans (Tier 2 capital) into Common Equity Tier 1 capital. In July, the group continued the adjustment of its business model by finalizing the sale of its 99.5% stake in Sberbank Slovensko. After closing the sale, Sberbank Europe shows a solid capital position with a Core Tier 1 capital ratio (CET1) of 15.8% compared to 10.7% at the end of 2015.

Despite the challenging business environment characterized by low interest rates and the sanction regime still in place, net interest income increased by 21% year-on-year, to EUR 148 m, mainly driven by the corporate business in Austria as well as group-wide liquidity optimization measures. Net fee and commission income grew by 10% to EUR 39 m. In parallel, general administrative expenses decreased by 13% year-on-year, from EUR 152 m to EUR 132 m, on the back of improved cost efficiency.

Sberbank Europe is continuously reducing its Non-performing loans portfolio. The bank’s NPLs shrunk by 12% compared to HY 2015, with the NPL ratio coming down to 10.5%, while the NPL coverage ratio improved to 45% from 39%. Compared to 2015, risk costs have stabilized, mainly due to lower NPL inflow. Hence, risk costs decreased from EUR 61 m year to date to EUR 37 m in HY 2015.

As of 30 June 2016, Sberbank Europe Group consolidated EUR 14,242 m in total assets (incl. Sberbank Slovensko), which corresponds to a slight decrease of 0.7% compared to end of year 2015. Without the sold Slovak business, Sberbank Europe shows total assets of EUR 12,504 m (compared to EUR 12,532 m as of end of year 2015 without the Slovak subsidiary).

Sberbank Europe grew its active customer base (excl. Sberbank Slovensko) by 9.4%, from 604 thousand clients at YE 2015 to 661 thousand clients as of 30.06.2016. The increase was driven largely by retail customer growth in Serbia and the Czech Republic.

Within its corporate business, Sberbank Europe remains focused on its strength to serve as a bridge between Russia/CIS and the European markets. The bank continues to serve its retail clients in CEE and Germany with the right offering of products and services, reflecting the needs of the customers in the different markets.

Key financial highlights of Sberbank Europe AG consolidated HY 2016 results (Sberbank Slovensko included as discontinued operations)*:

P&L Highlights

EUR million HY 2016 HY 2015
Net Result after taxes 13.8 - 65.2
Net Interest Income (NII) 148 122
Net Interest Margin (%) 2.4 2.1
Net fee and comission income 38.5 34.9
Cost/Income Ratio (%) 72 104
General administrative expenses 132 152
NPL coverage ratio (%) 45 39

Balance Sheet Highlights

EUR million HY 2016 (30.06.2016) YE 2015 (31.12.2015)
Total net customer loans 8,446 8,492
Total customer deposit 7,582 7,677
Loan/Deposit Ratio (%) 111 110.6
Core Tier 1 (CET1) ratio (%) 14.5 10.7
Capital Adequacy Ratio (%) 17.9 17.7
NPL ratio 10.5 11.3
Total assets 14,242 14,347

*Data 06/2016 and 06/2015 based on unaudited IFRS results

About Sberbank Europe

Sberbank Europe Group (Sberbank Europe AG), headquartered in Vienna, Austria, is a banking group that is 100% owned by Sberbank Russia. Sberbank Europe Group is present in nine markets in Central and Eastern Europe (CEE): Austria, Bosnia and Herzegovina, Croatia, Czech Republic, Germany, Hungary, Slovenia, Serbia and Ukraine. In total, the bank has over 4,200 employees, operates 232 branches and serves over 660,000 customers (as of HY 2016, without SK).

About Sberbank Group

Sberbank Russia is Russia’s largest bank and a leading global financial institution. Sberbank holds almost one third of aggregate Russian banking sector assets, it is the key lender to the national economy and the biggest deposit taker in Russia. The Central Bank of the Russian Federation is the founder and principal shareholder of Sberbank owning 50% of the Bank’s authorized capital plus one voting share, with the remaining 50% held by domestic and international investors. Sberbank has more than 135 million individual customers and 1 million corporate clients in 22 countries. Sberbank has the largest distribution network in Russia with almost 17,000 branches, and its international operations include UK, US, CIS, Central and Eastern Europe, Turkey and other countries. The bank holds a general banking license No. 1481 issued by the Bank of Russia.

As of HY 2016, Sberbank Group reported a net profit of RUB 145.4 bn (up by 166.3% compared to 2Q 2015. The Group return on equity (ROE) reached 22.8%, compared to 10.3% in 2Q 2015. Sberbank Group counts total assets of 25 794.0 bn RUB and has a market capitalization of 3.3 trln RUB.

Sberbank was awarded “Best Bank in CEE 2014” by The Banker magazine and “Best Information Security Initiatives in CEE 2015” by Global Finance magazine.

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